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Prospect Capital Q1 net investment income per share declines; co posts net loss

By Reuters News


Overview

  • U.S. middle-market lender's fiscal Q1 net investment income per share fell yr/yr

  • Company posted net loss attributable to common shareholders for the quarter, compared to a profit last year

  • Board increased share repurchase program to $200 mln


Outlook

  • Company did not provide specific financial guidance for upcoming quarters or full year in its press release


Result Drivers

  • PORTFOLIO ROTATION - Co increased focus on first lien senior secured middle market loans and reduced exposure to second lien and subordinated structured notes

  • AI AND AUTOMATION - Co said adoption of AI and automation initiatives aimed to improve portfolio company revenues and cost efficiencies

  • DEBT REDUCTION - Co reduced outstanding debt principal by 18% during the quarter, improving asset coverage ratios


Company press release:


Key Details

Metric

Beat/Miss

Actual

Consensus Estimate

Q1 Net Loss

$53.45 mln


Analyst Coverage

  • The one available analyst rating on the shares is "sell"

  • The average consensus recommendation for the closed end funds peer group is "buy."

  • Wall Street's median 12-month price target for Prospect Capital Corporation is $2.00, about 29% above its November 3 closing price of $1.55

  • The stock recently traded at 4 times the next 12-month earnings vs. a P/E of 6 three months ago


Reuters Recommended Reads

  • Nov 4 - TriplePoint Venture Growth Q3 net investment income falls, NAV per share declines

  • Nov 2 - New Mountain Finance Q3 adjusted net investment income falls YoY

  • Nov 3 - SLR Investment Q3 investment income falls on smaller portfolio


For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact reuters.support@thomsonreuters.com.


(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)

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